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Airline Winners & Losers: Delta

The Associated Press

Even another drop in oil prices couldn't help airline stocks.

The Amex airline index fell 3.8%, with 11 of its 13 component stocks declining.

Earlier Friday, the Labor Department reported that joblessness rose to 7.2% in December, the highest rate in nearly 16 years, raising fears that the economy hasn't yet hit bottom.

Worries about the U.S. and global economies helped push oil prices lower.

Light, sweet crude for February delivery fell $1.31 to $40.39 a barrel in afternoon electronic trading on the New York Mercantile Exchange.

Ray Neidl, an airline industry analyst for Calyon Securities, said Friday that airlines have taken tough steps to prepare for a downturn -- they cut capacity last year, so they have fewer seats to fill -- but that the economy remains their biggest concern.

Neidl widened his estimated fourth-quarter losses for most major U.S. airlines and said the industry would report $4.4 billion in losses for 2008. But he predicted that the industry will turn a $4.9 billion profit next year. He based that forecast on oil at $61.50 a barrel and a slow economic recovery beginning in the second quarter.

Besides worrying about the economy, airline executives are wondering what a new administration and Congress will mean for regulation.

This week, Democratic and Republican leaders of the Senate Judiciary Committee said alliances between U.S. and foreign airlines should be given antitrust immunity only in "extraordinary cases."

Some say such deals could hurt competition and raise prices for consumers.

American Airlines, owned by AMR (AMR Quote), is seeking antitrust immunity for a joint venture with British Airways (BAY Quote) and Spain's Iberia for trans-Atlantic flights, and Continental Airlines (CAL Quote) wants immunity for a deal with United, owned by UAL (UAL Quote), and Germany's Lufthansa on international routes.

Shares of Delta Air Lines (DAL Quote), the world's biggest airline operator, fell 46 cents, or 3.7%, to $11.76; shares of United Airlines parent UAL dropped 53 cents, or 4.2%, to $12.24; and American Airlines parent AMR lost 16 cents, or 1.3%, to $12.13.

Continental shares tumbled $1.21, or 5.6%, to $20.37; Southwest Airlines(LUV Quote) fell 43 cents, or 4.8%, to $8.56; US Airways Group (LCC Quote) lost 57 cents, or 6%, to $9.00.